Project Portfolio Management

We will decompose and explore individual words of project portfolio management (PPM) to understand the entire term better.

Starting with Portfolio: It means a briefcase. However, when we are talking about finance, then a portfolio represents a collection of assets held by an individual or an organization. Similarly, when we are talking about project development company’s portfolios, it means collections of projects that are currently handling by the organization.

The general meaning of Management is “the process of dealing with or controlling things or people.” In this case, we are dealing with the project.

In simple terms, PPM is the centralized management of an organization’s projects. It provides an overview of all the projects that an organization is undertaken, prioritizes resource allocation to projects, and decides which new projects should be accepted and which existing ones should be dropped.

The concerns of project portfolio management include:

1. Evaluating proposals for projects.
2. Assessing the risk involved with projects.
3. Deciding how to share resources between projects.
4. Taking account of dependencies between projects.
5. Removing duplication between projects.
6. Ensuring that necessary developments have not been inadvertently missed.

  There are three elements to PPM:

1. Project portfolio definition
   • Create a central record of all projects within an organization.
   • Must decide whether to have all projects in the repository or say only ICT (information communication technology) projects.
2. Project portfolio management
   • The actual costing and performance of projects can be recorded and assessed.
3. Project portfolio optimization
   • Information gathered above can be used to achieve a better balance of projects. E.g., some that are risky but potentially very valuable balanced by less risky but less valuable projects.

Pros and cons of Project Portfolio management

Pros: Allows some small ad-hoc tasks outside the portfolio, e.g., quick fixes to systems.

Cons: While the full-time staff is allocated to a project, they may effectively be part-time because they still have routine work to do. The official project portfolio may not accurately reflect organizational activity if some projects are excluded.

Reference:

1. Software Project Management, Rajib Mall, NPTEL.

 55 total views,  1 views today